Lone Star Ag Credit and Ag New Mexico Farm Credit recently signed a letter of intent (LOI) to merge the two associations. Under the terms of the LOI, each Board unanimously voted to move forward with thorough due diligence efforts to evaluate the merger’s benefits to the memberships of each association.
With approximately $2.6 billion in assets, Lone Star serves rural communities through its network of 16 locations across Texas. Ag New Mexico, with approximately $400 million in assets, delivers similar financing solutions across the entire state of New Mexico through its four locations.
The headquarters of the merged association would be located in Fort Worth, Texas, with current Lone Star Chief Executive Officer Joe Hayman serving as the CEO. No branch closures or branch staffing changes are anticipated.
“Both Associations are focused squarely on exceeding the expectations of our customer-owners,” said Hayman. “We look forward to exploring the possibility of combining our resources to become stronger and better.”
“At this early stage, we believe joining together allows the merged association to better serve agriculture and rural communities,” said Brent Neuhaus, Chairman of the Board for Lone Star Ag Credit. “For a financial institution, a dynamic and diversified market provides for improved operating efficiency and a stable source of competitive credit, which is a great benefit to the farmers and ranchers we serve.”
“Farm Credit’s mission is to provide reliable and consistent credit for agriculture and rural communities,” said Linda Brown, Chairman of the Board for Ag New Mexico Farm Credit. “This merger could strengthen both associations with greater lending capacity to better serve the agricultural producers who provide food, fuel and fiber for the nation.”
Should the due diligence confirm the expected benefits of a merger, the next step would be to seek regulatory approval from the Farm Credit Administration (FCA). Upon FCA approval, the merger would be brought before each association’s stockholders for consideration. The anticipated effective date of the merger is mid-2023.
